Free trade, expanding prosperity and technology dynamism are good things: but not everyone wins all the time.

June 30, 2016 – 3:03 pm

By Lorenzo

The following things are very much good things: free trade, technological dynamism and expanding global prosperity. Free trade because it gives more people to sell to and buy from, to engage in gains from trade with. Technological dynamism because it allows more and more people to live longer and (in some very basic senses) freer and more prosperous lives. Expanding global prosperity, because it means living millions upon millions of people out of the grinding constraints of poverty.

But none of these good things happen without costs. Free trade expands some industries in some places and retards or destroys them in others. Technological dynamism creates new industries and devastates some existing ones. Expanding global prosperity effectively expands the global labour market (even without movement of people) and puts pressure on labour incomes in already prosperous societies–particularly at the bottom end of the skill level.

It is not enough to point to the good these things do, if that provides an excuse to ignore the costs they also create. It is true that their benefits are so great that it is easily possible to compensate losers and still make everyone materially better off. But that it is easily possible does not mean that it is actually being done.

Which where the need for attentive social policy comes in. Attentive in a range of senses: attentive to who is losing, how and why. Attentive to concerns of people disoriented by change. Attentive to how policy can make things better for those who are on the losing any of economic and technological change. Attentive to how existing policies may be getting in the way of doing that, or even exacerbating the negative effects of such changes.

Added to these waves of change has been social changes, particularly the Emancipation Sequence. This has been going on in the West for over two centuries now, but with considerable acceleration in recent decades. This adds to the disorientation, particularly through loss of previous assumptions and presumptions. Such changes take time to absorb and are not helped by folk on the side of such changes being vicious winners: that is, not showing some charity and accepting a reasonable transition period but instead insisting on full public endorsement of every possible aspect of changes by everyone while being extremely intolerant of any lingering commitment to previous patterns, no matter how deeply rooted in tradition and belief such may be.

Migrating disorientation

Part of the accelerating social change has been a broadening of migration patterns into Western countries. In some places, notably Australia and Canada, such migration has been generally well-managed and led to remarkably little social angst, despite high rates of migration. In the US less so. In Europe, immigration has generally been managed quite poorly.

Well-managed migration is diverse in its origins, involves high level of border control, and does not adversely shift the labour/capital balance (mainly by importing people with relatively high level of human capital). It also involves making the case and in terms that resonate widely with voters. Moral hectoring is not making the case, it is self-indulgent posturing in place of the effort of persuading.

Poorly managed migration involves a lack of border control (giving many people the feeling of having no say over something with the capacity to profoundly change their society), imports large lumps from particular sources (making the resident culture less obviously dominant and more challenged) of people with lower human capital (shifting the economic balance to capital and away from labour, putting more stress on labour markets and welfare systems) and fails to make the case that resonates broadly with voters. How migration is, or is not, managed makes a huge difference.

Poison and block

But if migration is turned into a Virtue signal where one has to be “for migration” to be Virtuous, then the problems are exacerbated. The complexities are flattened out–by failing to differentiate between attitudes to legal and illegal immigration; deprecating considering costs from migration; refusing to consider that different sources and selection criteria make a difference, that migrants are not, in fact, interchangeable and undifferentiated. Rather than a public debate, one ends up with a public shouting match between an undifferentiated acceptance deemed Virtuous and any concern over any aspect being Vicious (and subject to the rhetoric of denunciation: racist, nativist, xenophobic, etc). Using, as I noted in my previous post, the shouting of bigot! as a weapon of bigotry (opinion-bigotry, but still bigotry). Worse, it encourages a tendency towards poor policy by inhibiting attention to social costs and concerns.

One can see this nicely illustrated by George Soros being dismissive of voices of opposition before the Brexit vote. He, at least, is being wise after the fact about the effect of mismanaged migration. Many are so attached to their markers of Virtue that they continue to shriek after the fact: Bourbons of Virtue, who forget nothing and learn nothing–“correcting” others, not themselves.

Connected to this, supporting multiculturalism has become a particularly strong Virtue signal. But the reality is that multiculturalism is a social and policy experiment, which may not work. Nor is it remotely a morally compulsory policy for every society.

The problem with using policies as Virtue signals is not only does that poison debate, it also blocks consideration of facts deemed to be Virtue-awkward (or even Virtue-hostile). This is both potentially disastrous in terms of social outcomes (facts do not go away merely by being deemed wrong to mention) and helps further poison public debate, since ignoring facts on the ground inevitably becomes a process of ignoring, or even demonising, those concerned by said facts.

Stripping away social ballast

What also doesn’t help is systematic attacks on common identities. A sense of national and cultural belonging can provide a sense of stability and even control: such things as, in the words of a recent post on the post-Brexit problems of the British Labour Party:

tradition, a respect for settled ways of life, a sense of place and belonging, a desire for home and rootedness, the continuity of relationships at work and in one’s neighbourhood.

provide a ballast against the disorienting effects of change. Attacking such identities as irretrievably stained with past sins (but somehow not attached to past achievements) attempts to knock away a comforting and stabilising part of social order, increasing the costs of social change–particularly their disorienting effect.

Creating unfortunate opportunities

Attentive policy flows out of listening politics. A political Party relies on balancing three things–rhetoric used, policies delivered and attention to voter concerns. The US Republican Party has got itself into The Donald mess because (at least at a federal level) it failed to pay sufficient attention to actual voter concerns while failing to match rhetoric to actions and actions to rhetoric.

But the Republican Party was also operating within a wider political and policy debate dynamic: part of the problem may well have been that its cosmopolitan operatives were inhibited from seeing how things seemed to its more traditionalist voters. As economist Luigi Zingales notes, if trust has been lost, the trick is not to blame those who no longer trust you (that just exacerbates the problem), but to work to rebuilt trust.

Which requires paying attention. Using policy positions as Virtue-markers blocks bothering to pay attention to–both the listening and attending to awkward facts. The result is an increase in political and policy dysfunction and, in particular, an increase in the numbers of angry and resentful voters. Who will inevitably start looking for folk willing to pay attention and who do not sneer at, or demonise, their concerns. Given enough economic and social stress, that gives an opportunity for people who, in more normal times, with sufficiently broadly attentive politics, would not get their chance.

Once such political entrepreneurs begin to get traction, it is further gist to the Virtue-demonising mill. And so the cycle builds with another spiral of Virtue-signalling and Vicious-demonising.

Once the spiral is underway, it is easy to point to the political entrepreneurs of angry and resentful politics and say “the problem is those dreadful people”. No, the problem is the refusal to pay attention by those whose proper role that is. Blaming others is so much easier than entertaining the problem that folk like oneself, folk with the beliefs which are so obviously Virtuous, are actually seriously problematic grit in the mechanisms of social adaptation via status-mongering and pseudo-comprehending contempt for those with different experiences and concerns.

Congenial framing as pseudo-comprehension

I say pseudo-comprehending because part of the game of Virtue is imposing a framing on folk and opinions which builds in dismissal of the opinion Other. It creates a crippled epistemology (pdf) which blocks attention and engagement with those outside the magic circle of the Virtuous. The illusion of knowing (and which deploying the rhetoric of denunciation expresses) blocks the capacity to genuinely see, let alone pay attention to: that’s how systems of bigotry work.

But framings provide comfort: they are our go-to ways of making sense of the world. The illusion of knowing is a very comforting illusion, particularly if it flatters one’s self-esteem. A British journalist’s mordant tweet:

Notice we in the press went from: “OMG we never saw this coming!!” right into “We’re experts on why they voted this way & what it means.”?

provides an illustration of the easy go-to comfort of our framings.

As journalist Damon Linker has noted, the contradiction of the secular faith of Progressivism–that history has a particular direction, which the Virtuous know and are leading their cognitive inferiors into–has taken a major knock, hence the outrage of frustrated faith. But it is a really bad idea to turn politics into your substitute religion, given how antipathetic dogmatic faith can be to the give and take of persuasion and reasoned debate. Just as it is not good to lose sight of how one’s sense of identity and attendant social experiences can be very different than other people’s: and if you are attached to your identity, why wouldn’t other people be attached to theirs?

Not everyone is a winner from the waves of globalisation and social change. Refusing to pay attention to those who are not–demonising them for being, in effect, those disproportionately bearing the material and psychic costs of change–in itself, increases the costs to them and to the wider society. At little less smug moral self-satisfaction, and bit more open-minded attention, would go a long way to make things better.

But that would require giving up the psychic benefits of the aforementioned self-satisfaction, and its attendant sneering contempt for fellow citizens, in exchange for rather more moral humility and paying attention: thereby being better citizens and better participants in the wider society. Which requires breaking through considerable epistemic barriers and giving up considerable psychic benefits. Even incurring some social costs as one departs from (and so chips away at) the collective game of smug self-satisfaction.

Thanks for being honest that free trade has a cost and benefits system. Yes, the benefits are wonderful. But ignoring the costs, and those negatively impacted by them doesn’t bode well for our futures.